Page 173 - GSTL_3rd September 2020_Vol 40_Part 1

2020 ] IN RE : P.K. MAHAPATRA 107
way Siding, the assessee provided taxable service for providing an
output service - Thus it is eligible to claim Cenvat credit : High
Court”
(q) The Appellant also wishes to rely on Schedule XIV to the Compa-
nies Act, 1956, wherein the rates of depreciation provided for
“Railway sidings” is categorized under the head plant and machin-
ery. Therefore, it can be said that Railway siding will qualify as
plant and machinery and meets the test of qualifying as plant and
machinery. Thus, the credit would be eligible.
(r) The Appellant wish to rely on the judicial precedents under Income-
tax Act, 1961 as below :
In the case of Chief Commissioner (Admn.) v. Visveswarayya Iron and
Steel Ltd., (1993) 199 ITR 98 (Kar), wherein the Karnataka High
Court treated Railway Siding as part of the plant.
In the case of Kalinga Tubes Ltd. v. CIT [1974] 96 ITR 20. The Orissa
High Court held in the said decision that the assessee was entitled
to the development rebate on railway sidings which were erected
for the purpose of business of the assessee. It was held that this was
covered by the heading “Machinery and plant” under Rule 8.
(s) Based on the above citations, it can be concluded that even as per
Companies Act and Income-tax Act, Railway Siding is construed as
Plant and Machinery and therefore credit on the same is eligible.
(t) Without any reference to the decision of the Delhi High Court in
Vodafone Mobile Services Limited v. Commissioner of Service Tax, Delhi,
CEAC 12/2016, dated 31-10-2018 [2019 (27) G.S.T.L. 481 (Del.)], the
reliance on the decision of the Bombay High Court in the Bharti
Airtel (case) [2014 (35) S.T.R. 865 (Bom.)], is completely erroneous
and misplaced.
(u) In the Vodafone Mobile Services Limited case, the Hon’ble Delhi High
Court had expressly recorded its dissent with the decision of the
Bombay High Court in the Bharti Airtel case and held the credit of
taxes paid of telecom towers is eligible. According to the Delhi High
Court, the Bombay High Court’s decision in the Bharti Airtel case
goes against the law laid down by the Apex Court in Commissioner
of Central Excise v. Solid and Correct Engineering Works, 2010 (5) SCC
122 = 2010 (252) E.L.T. 481 (S.C.). The relevant extracts of the deci-
sion are as under :-
“This court is of the opinion, with due respect to the Bombay High
Court that those two judgments are contrary to settled judicial
precedents, including the later view of the Supreme Court in Solid
and Correct Engineering (supra).”
(v) While the Hon’ble AAR ignored the reliance placed by the Appel-
lant on the case of M/s. Vodafone Mobile Services Ltd. during the
course of the hearing, the same authority placed reliance on the case
of M/s. Bharti Airtel Limited in support of its conclusion. The Appel-
lant submits that the principle debated in both the above matters
was the same but the AAR has rejected the contention on the Appel-
lant on one hand while relying on a similar issue to support their
stand.
GST LAW TIMES  3rd September 2020  189